Market turns bearish towards tech, but don’t bet against Apple yet

“When the market limped into the weekend after a dreary start to the new year, one of the biggest casualties was the computer hardware sector. Considering that the high-flying (AAPL: 177.64, -2.41, -1.3%) is one of its more prominent members, that is saying something,” Michael Kahn reports for Barrons.

“Apple has been the flagship tech stock for quite some time so let’s take a look at where it is today. Clearly, the long-term trend remains up here. Further, it has continued to forge higher highs and higher lows — the classic definition of a bullish trend — despite the sector and broad market’s inability to do the same,” Kahn reports.

“In other words, don’t bet against this winner just yet. What needs to be monitored is the waning of price momentum and increase in selling pressure over the past week because if Apple succumbs to the bear then the rest of the sector does not have a chance,” Kahn reports.

“With all facets of the technology sector, minus a few individual exceptions, sporting negative patterns or declining trends, investors should approach it with great skepticism. It is always a good idea to remain open to the possibility that a bottom is near but if tech is walking like a bear and growling like a bear then you know the rest,” Kahn reports.

Full article here.

34 Comments

  1. Bad investments: Gadgets, toys, hobbies.

    Good investments: Solid, necessary and relevant business & personal tools with long term staying power.

    Question for AAPL investors everywhere: does Steve understand this?

    His answer, as the opportunity to break into double digit market share in the personal computer market looms, determines the future of Apple Inc.

  2. @Macromancer

    Steve obsesses over what he calls ‘making great products’. But what he has focused on lately is being first to deliver gadgets, i.e. tunes players, phones, tee vee hobbies that are soon joined in the market place by many, many other flavors of these toys – always cheaper and with added features. Next step is for them to lose the ‘wow’ effect they enjoyed on the day he held them up on the Macworld stage.

    The future lies with the serious business of computers. His goal to be better than the worst is the wrong standard.

    The energies, brains, and power at Cupertino need to be more focused on the serious, long term Mac product line and OS and less on shiny dohickeys he can hold up for the purpose of hearing the air being sucked out of the room by an audience of worshipers (sheep).

    He should abandon arrogance and ego as his driving forces and we all (AAPL holders and Mac customers) can be bigger winners.

  3. @Macromancer regarding “The Solution”

    The Solution is just one of many pseudonyms used by a clueless writer whose one-answer-fits-all is that Steve Jobs is a reckless idiot and that the future of Apple is ONLY the Mac.

    I am having a hard time deciding whether he is a Windows troll or just a Mac fanboi who has drunk too much of the Kool-aid.

    In any case, I doubt that he is a stockholder — just a wannabe — who pretty obviously understands very little about business in general, and Apple in particular.

    Nothing to see or talk about here… move along.

  4. The Solution,

    what a load of codswallop!

    Why do you rate the revolutionary iPhone as a toy but not the Mac?
    The iPhone is covered, not without reason, by 200 new patents.
    Do you really think Nokia or anybody else will come up with a better product in the near future?

    Why do you refer to iPods and iPhones derogatively as ‘gadgets’ and Macs as ‘serious’?

    Think hard about it!

    It’s pure nonsense, isn’t it?

    Very last question:- how old are you?

  5. @ Ralph M

    Not necessary for you to figure me out. When Steve had to postpone the launch of Leopard because he had moved all the coders over to the phone lab to get that thing out the door, he proved my point. When the Leopard launch did occur, it was basically form over substance AND had the effect of turning OS 10.5 beta testing over to the public.

    He has focused on the toy shop. Investors have their fingers on the sell button when they buy into gadgets – they know it is a short term play and they hit that button with the slightest hiccup in either the marketing of the gadget or overall concerns about the immediate direction of the tech market.

    For those of us in for the long term, such behavior is disappointing – to say the least.

  6. Investors have their fingers on the sell button when they buy into gadgets – they know it is a short term play and they hit that button with the slightest hiccup in either the marketing of the gadget or overall concerns about the immediate direction of the tech market.

    How do you explain the spectacular run AAPL has had since the iPod/iTMS duo appeared? IMO that wasn’t much of a sign of a market with “their fingers on the sell button”.

    That said, the past few days have been rough for Apple stock. But I rather doubt it’s because the world thinks Apple’s gadget party is over.

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